Products and customers

This month marks my 19th anniversary of making my living in software development (except for a brief detour into publishing). Overall, it’s been a satisfying ride.

I started my career in 1989 at a small, privately owned software company in Terre Haute. There were lots of independent software companies in Indiana then, most of them located in or near Indianapolis. When I moved to Indianapolis in 1994, tech companies were growing like mad. Many of them went public to cash in, including the company I worked for. Then came the one-two punch of Y2K and Sept. 11, 2001, and the bubble burst. Some independent software companies went under; most merged or sold out, becoming part of a larger company.

Life in an independent software company can be oversimplified as this: Figure out what people in your market want and need, and then design and build it. If you got it right, it should sell. Then you make money, everybody’s paychecks clear at the bank, and everybody goes home happy. If it doesn’t sell, you retrench, cut costs, and pray a lot until you figure out your return to profitability.

Life in a public company that includes a software division can be oversimplified as this: Tell your shareholders you’re going to make a specific amount of money this year. Do what you must to make that much money. Now, the public company still has products they make and customers they sell to. But they come second to the company’s primary product, money, and primary customer, shareholders.

The first software company I worked for rode out a difficult time in our market while I was there. We were losing money for at least a year. We had some good stuff in the research and development pipeline, products that we felt were the company’s future, and we wanted to keep working on them at full speed. Still, we had two small layoffs and took two temporary pay cuts to see us through.

Another small software company I worked for went public. Where we had previously been able to strategically use some profit to invest in the business, it instead became more important to meet announced revenue projections. After the tech bubble burst, we remained profitable โ€“ but not as profitable as we said we’d be. So four or five quarters in a row, we met revenue projections by laying people off. Soon, those layoffs cut at bone, hampering our ability to deliver everything we believed the market needed from our products.

Today, I work for what was once an independent software company but is now a part of a global information services company. All I think I should say is that we, too, often enough behave in ways that serve the shareholder before the customer who uses our software. It’s the nature of working for a public company today. It just is what it is.

Yet I have nothing to do with shareholders and am unlikely ever to meet one โ€“ I develop products that customers use. It is demoralizing when decisions are made that make it hard for me to do my job well, especially when my understanding of our financial performance shows me we can clearly afford it. I want to be proud of the work that I do, and believe that my good work is helping customers meet their goals.

I’ve recently come across two articles along these lines. The first, from the New York Times, is about Avis, the car rental company. Did you know that it has changed hands 17 or 18 times since it was founded in 1946?  That’s once every three to four years! It became a pawn in games of corporate finance, all the while still renting cars at airports. Can you imagine how terrible a place that must be to work? The second, from today’s Rants blog at, talks about a radical transformation at the Ford Motor Company that focuses on โ€“ gasp! โ€“ developing better products as the way to turn the company around. Somebody at Ford has the right idea.


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